ECJ C-167/26 – ECJ will review EGC Case T-689/24 RX – VAT deduction and invoice timing

What is happening?

The Court of Justice of the EU (ECJ) has opened a review procedure under Article 62 of the Statute of the ECJ in Case C‑167/26 RX, following the General Court’s judgment of 11 February 2026 in T‑689/24. The review was initiated by the First Advocate General, meaning the ECJ will assess whether the General Court’s ruling raises a serious risk to the unity or consistency of EU law.

Background – what did the General Court decide (T‑689/24)?

The General Court held that input VAT must be deductible in the tax period in which the substantive conditions are met, even if the invoice is received only afterwards, provided that the invoice is available before the VAT return is filed.
It ruled that holding an invoice is a formal condition for exercising the right, not for the existence of the right to deduct VAT, and that postponing deduction breaches VAT neutrality and proportionality.

Why is the ECJ reviewing this?

A review (RX) is exceptional. It signals potential concern that the General Court may have:

Over‑expanded the separation between substantive and formal VAT conditions, or
Constrained Member States’ procedural autonomy in setting timing rules for VAT deduction.

The ECJ will not re‑hear the facts, but will assess whether the judgment could undermine coherence in EU VAT law, particularly in relation to Articles 167, 168(a) and 178(a) VAT Directive

Key legal issue under review

Can Member States deny deduction in a given VAT period solely because the invoice was not yet received during that period, even if it was received before filing the VAT return?

This goes to the heart of:

Timing of the right vs. exercise of the right to deduct, and
The balance between legal certainty, administrative control, and neutrality.

Why this matters for business

If the General Court approach is upheld:

✅ Businesses gain earlier cash‑flow neutrality
✅ Reduced exposure to technical denial of deduction
✅ Stronger alignment with Senatex, Terra Baubedarf, Zabrus Siret case law

If curtailed by the ECJ:

⚠️ Member States may retain strict invoice‑period rules
⚠️ Increased importance of invoice receipt timing, especially under e‑invoicing / real‑time reporting
⚠️ Potential divergence between substance‑based VAT law and digital compliance rules

Procedural snapshot

ECJ case: C‑167/26 RX
Review of: General Court judgment T‑689/24
Referring court: Naczelny Sąd Administracyjny (Poland)
Subject: VAT – right to deduct input VAT
Application lodged: 4 March 2026
Status: Pending review

Practical takeaway

This review could become a landmark decision on formal vs. substantive VAT requirements, with direct implications for e‑invoicing, SAF‑T and real‑time reporting regimes, where invoice timing is increasingly automated and visible.